165,632 Shares
COLONIAL PROPERTIES TRUST
Common Shares
UNDERWRITING AGREEMENT
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December 18, 1997
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated
000 Xxxxx Xxxxxxx Xxxxxx
P.O. Box 1476
Xxxxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
Colonial Properties Trust, an Alabama real estate investment trust, (the
"Company"), proposes to issue and sell 165,632 common shares of beneficial
interest of the Company, par value $.01 per share (the "Shares"), to Xxxx Xxxxx
Xxxx Xxxxxx, Incorporated (you or the "Underwriter"). The common shares of
beneficial interest, par value $.01 per share, of the Company to be outstanding
after giving effect to the sale contemplated hereby are hereinafter referred to
as the "Common Shares."
1. Registration Statement and Prospectus. The Company has prepared and
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filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations of the Commission thereunder (collectively called the
"Act"), registration statements on Form S-3 (Registration Nos. 333-18259 and
333-38613), the latter registration statement including a prospectus relating to
the registration of the Common Shares and certain other securities which may be
offered from time to time by the Company in accordance with Rule 415 under the
Act. Such registration statements (as amended, if applicable) have been declared
effective by the Commission on January 8, 1997, and November 21, 1997,
respectively. Such registration statement (as amended, if applicable), on the
one hand, and such prospectus and the prospectus supplement relating to the
offering of the Shares provided to the Underwriter by the Company for use
(whether or not such prospectus supplement is required to be filed with the
Commission by the Company pursuant to the Act) (the "Prospectus Supplement"), on
the other hand, including all documents incorporated therein by reference, as
from time to time amended or supplemented pursuant to the Securities Exchange
Act of 1934, as amended, and the rules and regulations of the Commission
thereunder (collectively called the "Exchange Act") and the Act are referred to
herein as the "Registration Statement" and the "Prospectus," respectively;
provided, however, that a prospectus supplement shall be deemed to have
supplemented the Prospectus only with respect to
the offering of the Shares to which it relates. Any registration statement
(including any amendment or supplement thereto or information which is deemed
part thereof) filed by the Company under Rule 462(b) of the Act (a "Rule 462(b)
Registration Statement") shall be deemed to be part of the "Registration
Statement" as defined herein and any prospectus or any term sheet as
contemplated by Rule 434 of the Act (a "Term Sheet") (including any amendment or
supplement thereto or information which is deemed part thereof) included in such
registration statement shall be deemed to be part of the "Prospectus," as
defined herein. All references in this Agreement to financial statements and
schedules and other information which is "contained," "included," "described" or
"stated" in the Registration Statement or the Prospectus (and all other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is or is deemed
to be incorporated by reference in the Registration Statement or Prospectus, as
the case may be; and all references in this Agreement to amendments or
supplements to the Registration Statement or the Prospectus shall be deemed to
mean and include, without limitation, even though not specifically stated, any
document filed under the Exchange Act which is or is deemed to be incorporated
by reference in the Registration Statement or the Prospectus, as the case may
be. Capitalized terms used but not otherwise defined herein shall have the
meanings given to those terms in the Prospectus.
2. Agreements to Sell and Purchase. On the basis of the representations and
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warranties contained in this Agreement, and subject to its terms and conditions,
the Company agrees to issue and sell the Shares and the Underwriter agrees to
purchase from the Company at a price per share of $28.8291 (the "Purchase
Price"), the Shares.
3. Terms of the Offering. The Company is advised by the Underwriter that it
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proposes (i) to deposit the Shares directly with the Trustee of Xxxx Xxxxx REIT
Trust, December 1997 Series (the "Trust"), a registered unit investment trust
under the Investment Company Act of 1940, as amended (the "Offering"), as soon
after the execution and delivery hereof as in its judgment is advisable and (ii)
initially to offer the Shares upon the terms set forth in the Prospectus. The
Company further acknowledges that the Underwriter is the sponsor of the Trust
and therefore is considered an affiliate of the Trust.
4. Delivery and Payment. Delivery to the Underwriter of certificates for,
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and payment of the Purchase Price for the Shares shall be made, subject to
Section 9, at 10:00 A.M., New York City time, on December 23, 1997, or such
other time not later than ten business days after such date as shall be agreed
upon by the Underwriter and the Company (such time and date of payment and
delivery being herein called the "Closing Date") at such place as you shall
designate. The Closing Date and the location of, delivery of and the form of
payment for the Shares may be varied by agreement between you and the Company.
Certificates for the Shares shall be registered in such names and issued
in such denominations as you shall request in a writing received by the Company
not later than two full business days prior to the Closing Date. Such
certificates shall be made available to you for inspection not later than 9:30
A.M., New York City time, on the business day next preceding the Closing Date.
Certificates in definitive form evidencing the Shares shall be delivered to you
on the Closing Date, with any transfer taxes thereon duly paid by the Company,
for the account of the Underwriter, against payment of the Purchase Price
therefor by intra-bank transfer or wire
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transfer of same day funds to such account as may be designated by the Company
at least two business days prior to the Closing Date.
5. Agreements of the Transaction Entities. The Company and the Operating
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Partnership (collectively, the "Transaction Entities") jointly and severally
agree with you as follows:
(a) In respect of the offering of Shares, the Company will (i) prepare a
Prospectus Supplement setting forth the number of Shares covered thereby and
their terms not otherwise specified in the Prospectus pursuant to which the
Shares are being issued, the name of the Underwriter and the number of Shares
which the Underwriter has agreed to purchase, the price at which the Shares are
to be purchased by the Underwriter from the Company, the initial offering price,
and such other information as the Underwriter and the Company deem appropriate
in connection with the offering of the Shares, and (ii) file the Prospectus in a
form approved by you pursuant to Rule 424(b) under the Act no later than the
Commission's close of business on the second business day following the date of
the determination of the offering price of the Shares. The Company will furnish
to the Underwriter and to such dealers as you shall specify as many copies of
the Prospectus as the Underwriter shall reasonably request for the purposes
contemplated by the Act or the Exchange Act.
(b) At any time when the Prospectus is required to be delivered under
the Act or the Exchange Act in connection with sales of Shares, the Transaction
Entities will advise you promptly and, if requested by you, confirm such advice
in writing, of (i) the effectiveness of any amendment to the Registration
Statement, (ii) the transmittal to the Commission for filing of any Prospectus
or other supplement or amendment to the Prospectus to be filed pursuant to the
Act, (iii) the receipt of any comments from the Commission relating to the
Registration Statement, any preliminary prospectus, the Prospectus or any of the
transactions contemplated by this Agreement, (iv) any request by the Commission
for post-effective amendments to the Registration Statement or amendments or
supplements to the Prospectus or for additional information, (v) the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or of the suspension of qualification of the Shares for
offering or sale in any jurisdiction, or the initiation of any proceeding for
such purposes, and (vi) the happening of any event as a result of which the
Prospectus as then amended or supplemented would include an untrue statement of
a material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances when the Prospectus is
delivered to a purchaser, not misleading. The Company will make every reasonable
effort to prevent the issuance of any stop order, and if at any time the
Commission shall issue any stop order suspending the effectiveness of the
Registration Statement, the Company will make every reasonable effort to obtain
the withdrawal or lifting of such order at the earliest possible time.
(c) The Company will furnish to you without charge, one signed copy of
the Registration Statement as first filed with the Commission and of each
amendment to it, including all exhibits, and furnish to you such number of
conformed copies of the Registration Statement as so filed and of each amendment
to it as you may reasonably request. If applicable, the copies of the
Registration Statement and each amendment thereto furnished to the Underwriter
will be identical to the electronically transmitted copies thereof filed with
the Commission pursuant to XXXXX, except to the extent permitted by Regulation
S-T.
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(d) At any time when the Prospectus is required to be delivered under
the Act or the Exchange Act in connection with sales of Shares, the Transaction
Entities will not file any amendment to the Registration Statement or any Rule
462(b) Registration Statement or make any amendment or supplement to the
Prospectus or any Term Sheet, if applicable, of which you shall not previously
have been advised or to which you or your counsel shall reasonably object; and
the Company will prepare and file with the Commission, promptly upon your
reasonable request, any amendment to the Registration Statement, Rule 462(b)
Registration Statement, Term Sheet, or amendment or supplement to the Prospectus
which, in the opinion of your counsel, may be necessary in connection with the
distribution of the Shares by you, and will use its best efforts to cause the
same to become promptly effective. If applicable, the Prospectus and any
amendments or supplements thereto furnished to the Underwriter will be identical
to the electronically transmitted copies thereof filed with the Commission
pursuant to XXXXX, except to the extent permitted by Regulation S-T.
(e) If, at any time when the Prospectus is required to be delivered
under the Act or the Exchange Act in connection with sales of Shares, any event
shall occur as a result of which, in the reasonable opinion of counsel for the
Underwriter, it becomes necessary to amend or supplement the Prospectus in order
to make the statements therein, in the light of the circumstances existing when
the Prospectus is delivered to a purchaser, not misleading, or if it is
necessary to amend or supplement the Prospectus to comply with any law, the
Company will forthwith prepare and file with the Commission an appropriate
amendment or supplement to the Prospectus so that the statements in the
Prospectus, as so amended or supplemented, will not contain an untrue statement
of a material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances existing when it is so
delivered, not misleading, or so that the Prospectus will comply with any law,
and to furnish to the Underwriter and to such dealers as you shall specify, such
number of copies thereof as the Underwriter or dealers may reasonably request.
(f) The Company will use its best efforts, in cooperation with the
Underwriter, to qualify, register or perfect exemptions for the Shares for offer
and sale by the Underwriter under the applicable state securities or Blue Sky
laws and real estate syndication laws of such jurisdictions as you may
reasonably request; provided, however, none of the Transaction Entities will be
required to qualify as a foreign corporation, file a general consent to service
of process in any such jurisdiction, subject itself to taxation in respect of
doing business in any jurisdiction in which it is not otherwise so subject, or
provide any undertaking or make any change in its charter or by-laws that the
Board of Directors of the Company reasonably determines to be contrary to the
best interests of the Company and its stockholders. In each jurisdiction in
which the Shares have been so qualified or registered, the Company will use all
reasonable efforts to file such statements, reports and other documents as may
be required by the laws of such jurisdiction, to continue such qualification or
registration in effect for so long a period as the Underwriter may reasonably
request for the distribution of the Shares.
(g) To make generally available to the Company's stockholders as soon as
reasonably practicable but not later than sixty (60) days after the close of the
period covered thereby (ninety (90) days in the event the close of such period
is the close of the Company's fiscal year), an earnings statement (in form
complying with the provisions of Rule 158 of the Act) covering a period of at
least twelve months after the effective date of the Registration Statement (but
in no
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event commencing later than ninety (90) days after such date) which shall
satisfy the provisions of Section 11(a) of the Act, and, if required by Rule 158
of the Act, to file such statement as an exhibit to the next periodic report
required to be filed by the Company under the Exchange Act covering the period
when such earnings statement is released.
(h) During the period of five years after the date of this Agreement, to
furnish to you as soon as available a copy of each regular and periodic report,
financial statement or other publicly available information of the Transaction
Entities and any of their subsidiaries mailed to the holders of the Shares or
filed with the Commission or any securities exchange, and any such publicly
available information concerning the Transaction Entities or any of their
subsidiaries as you may reasonably request.
(i) During the period when the Prospectus is required to be delivered
under the Act or the Exchange Act in connection with sales of the Shares, to
file all documents required to be filed by it with the Commission pursuant to
Section 13, 14 or 15 of the Exchange Act within the time periods required by the
Exchange Act.
(j) To pay all costs, expenses, fees and taxes incident to (i) the
preparation, printing, filing and distribution under the Act of the Registration
Statement and any amendment thereto (including financial statements and
exhibits), each preliminary prospectus, the Prospectus and all amendments and
supplements to any of them prior to or during the period specified in Section
5(b), (ii) the printing and delivery of this Agreement and the Blue Sky
Memorandum, (iii) the qualification of registration of the Shares for offer and
sale under the securities, Blue Sky laws or real estate syndication laws of the
several states in accordance with Section 5(f) hereof, (iv) the fee of and the
filings and clearance, if any, with the National Association of Securities
Dealers, Inc. (the "NASD") in connection with the Offering, (v) the fee of and
the listing of the Shares on the New York Stock Exchange, Inc. ("NYSE"), (vi)
furnishing such copies of the Registration Statement, the Prospectus and all
amendments and supplements thereto as may be requested for use in connection
with the offering or sale of the Shares by the Underwriter, (vii) the
preparation, issuance and delivery of certificates for the Shares to the
Underwriter, (viii) the costs and charges of any transfer agent or registrar,
(ix) any transfer taxes imposed on the sale by the Company of the Shares to the
Underwriter and (x) the fees and disbursements of the Company's counsel and
accountants.
(k) The Transaction Entities will use their best efforts to maintain the
listing of the Shares on the NYSE for a period of three years after the Closing
Date and thereafter unless the Company's Board of Trustees determines that it is
no longer in the best interests of the Company for the Shares to continue to be
so listed.
(l) The Transaction Entities will use their best efforts to do and
perform all things required to be done and performed under this Agreement by the
Transaction Entities prior to the Closing Date and to satisfy all conditions
precedent to the delivery of the Shares.
(m) The Company will use the net proceeds received by it from the sale
of the Shares in the manner specified in the Prospectus Supplement under "Use of
Proceeds."
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(n) The Company will prepare and file or transmit for filing with the
Commission in accordance with Rule 424(b) of the Act copies of the Prospectus.
(o) The Transaction Entities will use their best efforts to ensure that
the Company continues to qualify as a "real estate investment trust" ("REIT")
under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended
(the "Code"), for a period of three years after the date of this Agreement
unless the Company's Board of Trustees determines that it is no longer in the
best interest of the Company to be so qualified.
(p) The Transaction Entities will not at any time, directly or
indirectly, take any action intended, or which might reasonably be expected, to
cause or result in, or which will constitute, stabilization of the price of the
Shares to facilitate the sale or resale of any Shares in violation of the Act.
6. Representations and Warranties of the Transaction Entities. Each of the
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Transaction Entities jointly and severally represents and warrants to the
Underwriter as of the date hereof and the Closing Date that:
(a) The Registration Statement described in Section 1 hereof became
effective on January 8, 1997 and November 21, 1997. No stop order suspending the
effectiveness of the Registration Statement or any part thereof has been issued
and no proceeding for that purpose has been instituted or, to the knowledge of
the Transaction Entities, threatened by the Commission or by the state
securities authority of any jurisdiction. No order preventing or suspending the
use of the Prospectus has been issued and no proceeding for that purpose has
been instituted or, to the knowledge of the Transaction Entities, threatened by
the Commission or by the state securities authority of any jurisdiction.
(b) The Registration Statement and the Prospectus, including the
financial statements, schedules and related notes included in the Prospectus or
incorporated therein by reference and, if applicable, any Term Sheet to the
Prospectus, as of the date hereof and at the time the Registration Statement
became effective, and when any post-effective amendment to the Registration
Statement or Rule 462(b) Registration Statement becomes effective or any
amendment or supplement to the Prospectus is filed with the Commission, did or
will comply in all material respects with all applicable provisions of the Act.
The Prospectus, including the financial statements, schedules and related notes
included in the Prospectus or incorporated therein by reference, and if
applicable, any Term Sheet to the Prospectus, as of the date hereof and at the
time the Registration Statement became effective, and at the Closing Date, and
when any post-effective amendment to the Registration Statement or Rule 462(b)
Registration Statement becomes effective or any amendment or supplement to the
Prospectus is filed with the Commission, did or will comply in all material
respects with all applicable provisions of the Act. On the date the Registration
Statement was declared effective, on the date hereof, on the date of filing of
any Rule 462(b) Registration Statement and on the Closing Date, no part of the
Registration Statement or any amendment did or will contain an untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein not misleading. On
the date the Registration Statement was declared effective, on the date hereof,
as of its date, on the date of filing of any Rule 462(b) Registration Statement
and at the Closing Date, the Prospectus and the Prospectus Supplement did not or
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will not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. If a Rule 462(b)
Registration Statement is filed in connection with the offering and sale of the
Shares, the Company will have complied or will comply with the requirements of
Rule 111 under the Act relating to the payment of filing fees therefor. The
foregoing representations and warranties in this Section 6(b) do not apply to
any statements or omissions made in reliance on and in conformity with
information relating to the Underwriter furnished in writing to the Company by
the Underwriter specifically for inclusion in the Registration Statement or
Prospectus or any amendment or supplement thereto. The Transaction Entities have
not distributed any offering material in connection with the offering or sale of
the Shares other than the Registration Statement, the Prospectus or any other
materials, if any, permitted by the Act (which were disclosed to the Underwriter
and Underwriter's counsel).
(c) Each 462(b) Registration Statement, if any, complied or will comply
when so filed in all material respects with all applicable provisions of the
Act; did not or will not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; and the Prospectus delivered to the Underwriter for use in
connection with the offering of the Shares will, at the time of such delivery,
be identical to the electronically transmitted copies thereof filed with the
Commission pursuant to XXXXX, except to the extent permitted by Regulation S-T.
(d) The documents incorporated or deemed to be incorporated by reference
in the Prospectus pursuant to Item 12 of Form S-3 under the Act, at the time
they were, or hereafter are, filed with the Commission, complied and will comply
in all material respects with the requirements of the Exchange Act, and, when
read together with other information in and incorporated by reference in the
Prospectus, at the time the Registration Statement became effective, and as of
the Closing Date, or during the period specified in Section 5(b) did not and
will not include an untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. The foregoing
representations and warranties in this Section 6(d) do not apply to any
statements or omissions made in reliance on and in conformity with information
relating to the Underwriter furnished in writing to the Company by the
Underwriter specifically for inclusion in the Registration Statement or
Prospectus or any amendment or supplement thereto.
(e) The historical financial statements and the related notes thereto,
included or incorporated by reference in the Registration Statement and the
Prospectus, comply in all material respects with the requirements of the Act and
the Exchange Act, as applicable, and present fairly the consolidated financial
position of the Transaction Entities and their consolidated subsidiaries as of
the dates indicated and the results of their operations and the changes in their
cash flows for the periods specified; the financial statements with respect to
the Properties (as defined in the Prospectus) acquired by the Transaction
Entities, together with related notes, to the extent incorporated by reference
in the Registration Statement or the Prospectus, present fairly a summary of
gross income and direct operating expenses or a summary of gross income, as the
case may be, of such Properties for the indicated periods; except as otherwise
stated in the Registration Statement or the Prospectus, the foregoing financial
statements have been prepared in conformity with generally accepted accounting
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principles applied on a consistent basis, and the supporting schedules included
or incorporated by reference in the Registration Statement present fairly the
information required to be stated therein; the pro forma financial information,
and the related notes thereto, included or incorporated by reference in the
Registration Statement and the Prospectus comply in all material respects with
the applicable requirements of the Act and the Exchange Act, as applicable; the
assumptions used in preparing such pro forma information are reasonable and the
adjustments used therein are appropriate to give effect to the transactions
referred to therein; and the other financial and statistical information and
data set forth in the Registration Statement and the Prospectus are accurately
presented in all material respects and prepared on a basis consistent with the
books and records of the Transaction Entities and their consolidated
subsidiaries.
(f) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, (i) there has not been any material
adverse change, or any development involving a prospective material adverse
change, in or affecting the condition (financial or otherwise), business,
prospects, properties, net worth or results of operations of the Transaction
Entities and their subsidiaries, taken as a whole, otherwise than as set forth
or contemplated in the Prospectus; and (ii) except as set forth or contemplated
in the Prospectus, neither the Transaction Entities nor any of their
subsidiaries has entered into any transaction or agreement (whether or not in
the ordinary course of business) material to the Transaction Entities and their
subsidiaries, taken as a whole.
(g) The Company has been duly incorporated and is validly existing as a
real estate investment trust in good standing under the laws of the state of
Alabama, with trust power and authority to own or lease its properties and to
conduct its business as described in the Prospectus, and is duly qualified as a
foreign entity for the transaction of business and is in good standing under the
laws of each other jurisdiction in which it owns or leases properties, or
conducts any business, so as to require such qualification, other than where the
failure to be so qualified or in good standing would not (1) have a material
adverse effect on the condition (financial or otherwise), business, prospects,
properties, net worth or results of operations of the Transaction Entities and
their subsidiaries, taken as a whole, (2) adversely affect the issuance or
validity of the Shares or (3) adversely affect the consummation of any of the
transactions contemplated by this Agreement (each of (1), (2) and (3) above, a
"Material Adverse Effect"); except for investments in their subsidiaries, in
short-term investment securities and in other securities as described in the
Registration Statement or Prospectus, the Company has no direct or indirect
equity or other interest in any corporation, partnership, trust or other entity;
each of the subsidiaries of the Company is listed on Schedule I hereto and has
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been duly organized and is validly existing as a corporation, limited
partnership or limited liability corporation, as the case may be, in good
standing under the laws of its jurisdiction of organization with corporate,
partnership or limited liability company power and authority, as the case may
be, to own or lease its properties and conduct its business as presently
conducted and as described in the Prospectus, and has been duly qualified as a
foreign corporation, foreign limited partnership or foreign limited liability
company, as the case may be, for the transaction of business and is in good
standing under the laws of each other jurisdiction in which it owns or leases
properties, or conducts any business, so as to require such qualification, other
than where the failure to be so qualified or in good standing would not have a
Material Adverse Effect; all the outstanding shares of capital stock of each
subsidiary have been duly authorized and validly issued and are
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fully paid and nonassessable; except as disclosed in the Prospectus or in
Schedule I hereto, all the outstanding shares of capital stock and all
partnership interests of each subsidiary are owned by the Company, directly or
indirectly, free and clear of all liens, encumbrances, security interests and
claims.
(h) The Operating Partnership has been duly formed and is validly
existing as a limited partnership in good standing under the laws of the State
of Delaware, is duly qualified to do business as a foreign limited partnership
in each jurisdiction in which its ownership or lease of property or the conduct
of its business requires such qualification (except where the failure to be so
qualified would not have a Material Adverse Effect on the earnings, assets or
business affairs of the Transaction Entities and their subsidiaries considered
as a single enterprise), and has all partnership power and authority necessary
to own or hold its properties, to conduct the business in which it is engaged
and to enter into and perform its obligations under this Agreement. The General
Partner is the sole general partner of the Operating Partnership. The Agreement
of Limited Partnership of the Operating Partnership, as amended (the "Operating
Partnership Agreement") is in full force and effect, and the aggregate
percentage interests of the Company, the General Partner and the limited
partners in the Operating Partnership are as set forth in the Prospectus.
(i) The General Partner has been duly formed and is validly existing as
a corporation in good standing under the laws of the State of Alabama, is duly
qualified to do business and is in good standing in each jurisdiction in which
its ownership or lease of property or the conduct of its business requires such
qualification (except where the failure to be so qualified would not have a
Material Adverse Effect on the earnings, assets or business affairs of the
Transaction Entities and their subsidiaries considered as a single enterprise),
and has all corporate power and authority necessary to own or hold its
properties, to conduct the business in which it is engaged and to enter into and
perform its obligations under this Agreement. All of the issued and outstanding
capital stock of the General Partner has been duly authorized and validly issued
and is fully paid and non-assessable, is owned by the Company free and clear of
any security interest, mortgage, pledge, lien, encumbrance, claim, restriction
or equities. No shares of capital stock of the General Partner are reserved for
any purpose, and there are no outstanding securities convertible into or
exchangeable for any capital stock of the General Partner, and no outstanding
options, rights (preemptive or otherwise) or warrants to purchase or to
subscribe for shares of such capital stock or any other securities of the
General Partner.
(j) This Agreement has been duly authorized, executed and delivered by
the Transaction Entities.
(k) The Shares have been duly authorized and, when issued and delivered
to the Underwriter against payment therefor in accordance with the terms hereof,
will be validly issued, fully paid and nonassessable. Application has been made
to list the Shares on the NYSE. The form of certificate for the Shares will
comply with all applicable legal and NYSE requirements. The holders of
outstanding shares of capital stock of the Company are not entitled to
preemptive or other rights to subscribe for the Shares. The capital stock of the
Company conforms to the description thereof in the Registration Statement and
the Prospectus.
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(l) Neither the Transaction Entities nor any of their subsidiaries is,
or with the giving of notice or lapse of time or both would be, in violation of
or in default under (1) its Articles of Incorporation, Certificate of
Incorporation or partnership agreement, as the case may be (in each case as
amended to the date of this Agreement), (2) its Bylaws (as amended to the date
of this Agreement) or (3) any indenture, mortgage, deed of trust, loan
agreement, partnership agreement or other agreement or instrument or obligation
to which such Transaction Entity or any of it subsidiaries is a party or by
which it or any of its properties is bound, except, with respect to clauses (2)
and (3), for violations and defaults which individually or in the aggregate
would not have a Material Adverse Effect; the issue and sale of the Shares and
the performance by each of the Transaction Entities of all of the obligations
under this Agreement and the consummation of the transactions herein
contemplated will not conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement, partnership agreement or other material agreement or
instrument to which any of the Transaction Entities or any of their subsidiaries
is a party or by which any of the Transaction Entities or of their subsidiaries
is bound or to which any of the property or assets of the Transaction Entities
or any of their subsidiaries is subject, except for such conflicts, breaches,
defaults or violations which individually or in the aggregate would not have a
Material Adverse Effect, nor will any such action result in any violation of the
provisions of the Declaration of Trust or the ByLaws of the Company or any
applicable law or statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over any of the Transaction
Entities or any of their properties, except for such violations which
individually or in the aggregate would not have a Material Adverse Effect; and
no consent, approval, authorization, order, registration or qualification of or
with any such court or governmental agency or body is required for the issue and
sale of the Shares or the consummation by the Transaction Entities of the
transactions contemplated by this Agreement, except such consents, approvals,
authorizations, orders, registrations or qualifications (x) as have been
obtained under the Act and the Exchange Act, (y) as may be required under the
Act, the Exchange Act, state securities or Blue Sky laws or Sections 2710 and
2720 of the Conduct Rules of the NASD in connection with the purchase and
distribution of the Shares by the Underwriter or (z) the failure to obtain which
would not have a Material Adverse Effect.
(m) Other than as set forth or contemplated in the Prospectus, there are
no legal or governmental proceedings pending or, to the knowledge of any of the
Transaction Entities, threatened to which any of the Transaction Entities or
their subsidiaries is or may be a party or to which any property of any of the
Transaction Entities or their subsidiaries is or may be the subject which, if
determined adversely to the Transaction Entities, could individually or in the
aggregate reasonably be expected to have a Material Adverse Effect; there are no
contracts or other documents of a character required to be filed as an exhibit
to the Registration Statement or required to be described in the Registration
Statement or the Prospectus which are not filed or described as required; and
the descriptions of the terms of all such contracts and documents contained or
incorporated by reference in the Registration Statement or Prospectus are
complete and correct in all material respects.
(n) The authorized capital stock of the Company consists of 65 million
Common Shares, $.01 par value per share, and 10 million shares of preferred
stock, $.01 par value per share. All of the issued shares of capital stock of
the Company have been duly and validly authorized and issued and are fully paid
and nonassessable.
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(o) One of the Transaction Entities or their subsidiaries has good and
marketable title to each Property, in each case free of any lien, mortgage,
pledge, charge or encumbrance of any kind except those (i) described in the
Prospectus or (ii) which do not materially affect or detract from the value of
such Property or interfere with the use made and proposed to be made of such
Property by the Transaction Entities and their subsidiaries and which
individually and in the aggregate are in an amount which is not material to the
Transaction Entities and their subsidiaries, taken as a whole.
(p) Except as disclosed in the Prospectus, each entity identified in the
Prospectus as a tenant of any Property, or a subtenant thereof, has entered into
a lease or a sublease, if applicable, for the possession of such Property;
except as disclosed in the Prospectus, each such lease is in full force and
effect and neither the Transaction Entities nor any of their subsidiaries has
notice of any defense to the obligations of the tenant thereunder or any claim
asserted or threatened by any person or entity, which claim, if sustained, would
have a Material Adverse Effect; and except as disclosed in the Prospectus, the
lessor under each lease has complied with its obligations under such lease in
all material respects and neither the Transaction Entities nor any of their
subsidiaries has notice of any default by the tenant under such lease which,
individually or in the aggregate with other such defaults, would have a Material
Adverse Effect.
(q) The mortgages and deeds of trust encumbering the Properties are not
(i) cross-defaulted to any indebtedness other than indebtedness of the
Transaction Entities or any of their subsidiaries or (ii) cross-collateralized
to any property not owned by any of the Transaction Entities or their
subsidiaries.
(r) Each of the Transaction Entities and their subsidiaries are insured
by insurers of recognized financial responsibility against such losses and risks
and in such amounts as are customary in the business in which they are engaged
and such insurance is adequate for the value of their properties; all policies
of insurance insuring the Transaction Entities or their subsidiaries or their
respective businesses, assets, employees, officers, trustees and directors, as
the case may be, are in full force and effect; each of the Transaction Entities
and their subsidiaries is in compliance with the terms of such policies in all
material respects and there are no claims by any of the Transaction Entities or
by their subsidiaries under any such policy as to which any insurance company is
denying liability or defending under a reservation of rights clause, other than
claims which individually or in the aggregate would not have a Material Adverse
Effect.
(s) Each of the Transaction Entities has filed all federal, state and
foreign income tax returns which have been required to be filed and have paid
all taxes indicated by said returns and all assessments received by it to the
extent that such taxes have become due and are not being contested in good
faith.
(t) Each of the Transaction Entities and each of their subsidiaries
owns, possesses and has obtained all material licenses, permits, certificates,
consents, orders, approvals and other authorizations from, and has made all
material declarations and filings with, all federal, state, local and other
governmental authorities, all self-regulatory organizations and all courts and
other tribunals necessary to own or lease, as the case may be, and to operate
its properties and to carry on its business as conducted as of the date hereof,
except in each case where the failure to
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obtain licenses, permits, certificates, consents, orders, approvals and other
authorizations, or to make all declarations and filings, would not have a
Material Adverse Effect, and none of the Transaction Entities or any of their
subsidiaries has received any notice of any proceeding relating to revocation or
modification of any such license, permit, certificate, consent, order, approval
or other authorization, except as described in the Prospectus and except, in
each case, where such revocation or modification would not have a Material
Adverse Effect; and the Transaction Entities and each of their subsidiaries are
in compliance with all laws, rules and regulations relating to the conduct of
their respective businesses as conducted as of the date hereof, except where
noncompliance with such laws, rules or regulations would not have a Material
Adverse Effect.
(u) To the knowledge of the Transaction Entities, their independent
accountants who have certified certain of the financial statements filed with
the Commission as part of, or incorporated by reference in, the Registration
Statement or the Prospectus, are independent public accountants as required by
the Act.
(v) To the knowledge of the Transaction Entities, no relationship,
direct or indirect, exists between or among any of the Transaction Entities or
their subsidiaries on the one hand, and the directors, trustees, officers,
stockholders, customers or suppliers of any of the Transaction Entities or their
subsidiaries on the other hand, which is required by the Act to be described in
the Registration Statement and the Prospectus which is not so described.
(w) Each of the Transaction Entities has never been, is not now, and
immediately after giving effect to the sale of the Shares under this Agreement
will not be, an "investment company" or entity "controlled" by an "investment
company," within the meaning of the Investment Company Act of 1940, as amended
(the "Investment Company Act").
(x) With respect to all tax periods regarding which the Internal Revenue
Service is or will be entitled to assert any claim against any of the
Transaction Entities, the Company has met the requirements for qualification as
a REIT under Sections 856 through 860 of the Code, and the present and
contemplated operations, assets and income of the Transaction Entities and their
subsidiaries, taken as a whole, continue to meet such requirements.
(y) Other than as disclosed in the Prospectus, the Transaction Entities
have no knowledge of (a) the unlawful presence of any hazardous substances,
hazardous materials, toxic substances or waste materials (collectively,
"Hazardous Materials") on any of the Properties or (b) any unlawful spills,
releases, discharges or disposals of Hazardous Materials that have occurred or
are presently occurring on or from the Properties, which presence or occurrence
would individually or in the aggregate have a Material Adverse Effect.
(z) Other than as disclosed in the Prospectus, the Transaction Entities
and their subsidiaries (i) are in compliance with any and all applicable
federal, state and local laws and regulations relating to the protection of
human health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants ("Environmental Laws"), (ii) have received
all permits, licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii) are in
compliance with all terms and conditions of any such permit, license or
approval, except where such noncompliance
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with Environmental Laws, failure to receive required permits, licenses or other
approvals or failure to comply with the terms and conditions of such permits,
licenses or approvals would not individually or in the aggregate have a Material
Adverse Effect.
(aa) In the ordinary course of business, the Transaction Entities engage
environmental consultants and other experts to conduct reviews of the effect of
Environmental Laws on the business, operations and properties of the Transaction
Entities and their subsidiaries, in the course of which the Transaction Entities
identify and evaluate associated costs and liabilities (including, without
limitation, any capital or operating expenditures required for cleanup, closure
of properties or compliance with Environmental Laws or any permit, license or
approval, any related constraints on operating activities and any potential
liabilities to third parties). On the basis of such reviews and other than as
described in the Prospectus, the Transaction Entities have reasonably concluded
that such associated costs and liabilities would not, individually or in the
aggregate, have a Material Adverse Effect.
(bb) Subsequent to the respective dates as of which information is given
in the Prospectus, (i) the Company has not purchased any of its outstanding
shares of capital stock, or declared, paid or otherwise made any dividend or
distribution of any kind on its shares of capital stock other than regular
periodic dividends on such shares; and (ii) there has not been any material
change in the shares of capital stock of the Company or any material change in
the short-term debt or long-term debt of the Transaction Entities and their
subsidiaries on a consolidated basis, except as described in or contemplated by
the Prospectus. Other than as described in or contemplated by the Prospectus,
including documents incorporated therein by reference, there are no outstanding
warrants or options to purchase or rights to acquire any shares of capital stock
of the Company (other than options or rights granted or issued under the
Company's employee benefit plans) and there are no restrictions upon the voting
or transfer of, or the declaration or payment of any dividend or distribution
on, any shares of capital stock of the Company pursuant to the Company's
Articles of Incorporation or Bylaws, any agreement or other instrument to which
any of the Transaction Entities is a party or by which any of the Transaction
Entities is bound, or any order, law, rule, regulation or determination of any
court, governmental agency or body (including, without limitation, any banking
or insurance regulatory agency or body), or arbitrator having jurisdiction over
any of the Transaction Entities. No holders of securities of the Company or of
securities convertible into or exchangeable for securities of the Company have
rights to the registration of such securities of the Company under the
Registration Statement.
(cc) The Transaction Entities and their subsidiaries and affiliates have
not taken and will not take, directly or indirectly, any action designed to, or
that might be reasonably expected to, cause or result in stabilization or
manipulation of the price of the Shares, and the Transaction Entities and their
subsidiaries and affiliates have not distributed and agree not to distribute any
prospectus or other offering material in connection with the offering and sale
of the Shares other than the Prospectus or other material permitted by the Act.
(dd) Each of the Transaction Entities maintains a system of internal
accounting controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit preparation
of financial statements in conformity with generally accepted
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accounting principles and to maintain accountability for assets; (iii) access to
assets is permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(ee) There is (i) no significant unfair labor practice complaint pending
against any of the Transaction Entities or their subsidiaries or, to the
knowledge of the Transaction Entities, threatened against any of them, before
the National Labor Relations Board or any state or local labor relations board,
and no significant grievance or more significant arbitration proceeding arising
out of or under any collective bargaining agreement is so pending against any of
the Transaction Entities or their subsidiaries or, to the knowledge of the
Transaction Entities, threatened against any of them, and (ii) no significant
strike, labor dispute, slowdown or stoppage pending against any of the
Transaction Entities or their subsidiaries or, to the knowledge of the
Transaction Entities, threatened against it or any of their subsidiaries except
for such actions specified in clause (i) or (ii) above which individually or in
the aggregate could not reasonably be expected to have a Material Adverse
Effect.
(ff) No statement, representation, warranty or covenant made by any of
the Transaction Entities in this Agreement or made in any certificate or
document required by this Agreement to be delivered to the Underwriter is, or
will be, when made, inaccurate, untrue or incorrect in any material respect; it
being understood that no representation is made under this Section 6(gg) with
respect to the Registration Statement or the Prospectus which are the subject of
representations contained in other paragraphs in this Section 6.
(gg) Any certificate or other document signed by any officer or
authorized representative of any of the Transaction Entities or any of their
subsidiaries, and delivered to the Underwriter or to counsel for the Underwriter
in connection with the sale of the Shares shall be deemed a representation and
warranty by such entity or person, as the case may be, to the Underwriter as to
the matters covered thereby.
7. Indemnification.
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(a) Each of the Transaction Entities jointly and severally agrees to
indemnify and hold harmless the Underwriter and each person, if any, who
controls the Underwriter within the meaning of Section 15 of the Act or Section
20 of the Exchange Act, from and against any and all losses, claims, damages,
expenses, liabilities and judgments caused by or resulting from any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto) or any
preliminary prospectus, or caused by or resulting from any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as such
losses, claims, damages, expenses, liabilities or judgments are caused by or
result from any such untrue statement or omission or alleged untrue statement or
omission based upon and in conformity with information furnished in writing to
the Company by or on behalf of the Underwriter through you expressly for use
therein, provided, that this indemnity agreement with respect to any preliminary
prospectus shall not inure to the benefit of the Underwriter from whom the
person asserting any such losses, liabilities, claims, damages or expenses
purchased
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Shares, or any person controlling the Underwriter, if a copy of the prospectus
(as then amended or supplemented if the Company shall have furnished any such
amendments or supplements thereto) was not sent or given by or on behalf of the
Underwriter to such person, if such is required by law, at or prior to the
written confirmation of the sale of such Shares to such person and if the
Prospectus (as so amended or supplemented) would have corrected the defect
giving rise to such loss, liability, claim, damage or expense.
(b) In case any action shall be brought against the Underwriter or any
person controlling the Underwriter, based upon any preliminary prospectus, the
Registration Statement or the Prospectus or any amendment or supplement thereto
and with respect to which indemnity may be sought against any of the Transaction
Entities, the Underwriter shall promptly notify the Company in writing and the
Company may, at its election, assume the defense thereof, including the
employment of counsel reasonably satisfactory to such indemnified party and
payment of all fees and expenses. The Underwriter or any such controlling person
shall have the right to employ separate counsel in any such action and
participate in the defense thereof, but the fees and expenses of such counsel
shall, if any of the Transaction Entities has assumed the defense as indicated
above, be at the expense of the Underwriter or such controlling person unless
(i) the employment of such counsel shall have been specifically authorized in
writing by one of the Transaction Entities, (ii) the Transaction Entities shall
have failed to assume the defense and employ counsel or (iii) the named parties
to any such action (including any impleaded parties) include both the
Underwriter or such controlling person and the Transaction Entities and the
Underwriter or such controlling person shall have been advised by such counsel
that there may be one or more legal defenses available to it which are different
from or additional to those available to the Transaction Entities (in which case
the Transaction Entities shall not have the right to assume the defense of such
action on behalf of the Underwriter or such controlling person, it being
understood, however, that the Transaction Entities shall not, in connection with
any one such action or separate but substantially similar or related actions in
the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (in addition to any local counsel) for the Underwriter and
controlling persons, which firm shall be designated in writing by the
Underwriter and that all such fees and expenses shall be reimbursed as they are
incurred). None of the Transaction Entities shall be liable for any settlement
of any such action effected without its written consent, but if settled with
their written consent, each of the Transaction Entities agrees to indemnify and
hold harmless the Underwriter and any such controlling person from and against
any loss or liability by reason of such settlement to the extent required by
this Section 7. Notwithstanding the immediately preceding sentence, if in any
case where the fees and expenses of counsel are at the expense of the
indemnifying party and an indemnified party shall have requested the
indemnifying party to reimburse the indemnified party for such fees and expenses
of counsel as incurred, such indemnifying party agrees that it shall be liable
for any settlement of any action effected without its written consent, if (i)
such settlement is entered into more than forty business days after the receipt
by such indemnifying party of the aforesaid request and (ii) such indemnifying
party shall have failed to reimburse the indemnified party in accordance with
such request for reimbursement prior to the date of such settlement; provided,
however, that if it is determined by a final non appealable order of a court of
competent jurisdiction that any of the Transaction Entities have no
indemnification obligation under this Section 7, all fees and expenses paid by
any of the Transaction Entities pursuant to this sentence shall be returned to
them upon demand. No indemnifying party shall, without the prior written
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consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such proceeding.
(c) The Underwriter agrees to indemnify and hold harmless each of the
Transaction Entities and each of their officers and directors who sign the
Registration Statement and any person controlling any of the Transaction
Entities within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, to the same extent as the foregoing indemnity from each of the
Transaction Entities to the Underwriter, but only with reference to and in
conformity with information furnished in writing by or on behalf of the
Underwriter expressly for use in the Registration Statement, the Prospectus or
any preliminary prospectus. In case any action shall be brought against any of
the Transaction Entities, any of their officers, directors, or any person
controlling any of the Transaction Entities, based on the Registration
Statement, the Prospectus or any preliminary prospectus and in respect of which
indemnity may be sought against the Underwriter, the Underwriter shall have the
rights and duties given to the Transaction Entities (except that if any of the
Transaction Entities shall have assumed the defense thereof, the Underwriter
shall not be required to do so, but may employ separate counsel therein and
participate in the defense thereof but the fees and expenses of such counsel
shall, except as otherwise provided herein, be at the expense of the
Underwriter), and each of the Transaction Entities, their officers, directors,
and any person controlling any of the Transaction Entities shall have the rights
and duties given to the Underwriter, by Section 7(b) hereof.
(d) If the indemnification provided for in this Section 7 is unavailable
to an indemnified party in respect of any losses, claims, damages, expenses,
liabilities or judgments referred to therein, then each indemnifying party, in
lieu of indemnifying such indemnified party, shall contribute to the amount paid
or payable by such indemnified party as a result of such losses, claims,
damages, expenses, liabilities and judgments (i) in such proportion as is
appropriate to reflect the relative benefits received by the Transaction
Entities on the one hand and the Underwriter on the other hand from the offering
of the Shares or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Transaction Entities, on the one hand, and the Underwriter, on the
other hand, in connection with the statements or omissions which resulted in
such losses, claims, damages, expenses, liabilities or judgments, as well as any
other relevant equitable considerations. The relative benefits received by the
Transaction Entities, on the one hand, and the Underwriter, on the other hand,
shall be deemed to be in the same proportion as the total net proceeds from the
Offering (before deducting expenses) received by the Transaction Entities and
the total underwriting discounts and commissions received by the Underwriter,
bear to the total price to the public of the Shares, in each case as set forth
in the table on the cover page of the Prospectus. The relative fault of the
Transaction Entities, on the one hand, and the Underwriter, on the other hand,
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission to state a material
fact relates to information supplied by any of the Transaction Entities or the
Underwriter and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
-16-
Each of the Transaction Entities and the Underwriter agree that it
would not be just and equitable if contribution pursuant to this Section 7(d)
were determined by pro rata allocation or by any other method of allocation
which does not take account of the equitable considerations referred to in the
immediately preceding paragraph. The amount paid or payable by an indemnified
party as a result of the losses, claims, damages, expenses, liabilities or
judgments referred to in the immediately preceding paragraph shall be deemed to
include, subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Section 7, the Underwriter shall not be required to contribute any amount in
excess of the amount by which the total price at which the Shares underwritten
by it and distributed to the public were offered to the public exceeds the
amount of any damages which the Underwriter has otherwise been required to pay
by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
(e) The Underwriter confirms and each Transaction Entity acknowledges
that (i) the statements with respect to the public offering of the Shares by the
Underwriter set forth on the cover page of the Prospectus Supplement, (ii) the
legend concerning overallotments on page 2 of the Prospectus Supplement, (iii)
the second paragraph under the caption "Underwriting" in the Prospectus
Supplement constitute the only information concerning the Underwriter furnished
in writing to the Company by or on behalf of the Underwriter specifically for
inclusion in the Registration Statement and Prospectus.
8. Conditions of Underwriter's Obligations. The obligations of the
---------------------------------------
Underwriter to purchase the Shares under this Agreement are subject to the
satisfaction of each of the following conditions:
(a) All the representations and warranties of the Transaction Entities
contained in this Agreement shall be true and correct, in all material respects,
on the Closing Date, with the same force and effect as if made on and as of the
Closing Date.
(b) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been commenced or shall be pending before or threatened by the Commission to the
knowledge of the Company. No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been commenced or shall be pending before or threatened by
the state securities authority of any jurisdiction, to the knowledge of the
Company.
(c) (i) Since the date of the latest balance sheet included or
incorporated by reference in the Registration Statement and the Prospectus,
there shall not have been any Material Adverse Effect, (ii) other than as set
forth in the Prospectus, no proceedings shall be pending or, to the knowledge of
any of the Transaction Entities, threatened against any of the Transaction
Entities or any Property before or by any federal, state or other commission,
board or administrative agency, where an unfavorable decision, ruling or finding
could reasonably be expected to result in a Material Adverse Effect, and on the
Closing Date you shall have received
-17-
a certificate dated the Closing Date, signed by the Chief Executive Officer or a
Vice President of the Company and the Chief Financial Officer of the Company and
by the Chief Executive Officer or a Vice President of the General Partner and by
the Chief Financial Officer of the General Partner, in its capacities as the
General Partner of the Operating Partnership, confirming the matters set forth
in paragraphs (a), (b) and (c) of this Section 8.
(d) You shall have received on the Closing Date opinions, dated the
Closing Date of Xxxxx & Xxxxxxx L.L.P., counsel for the Company, in the forms
attached hereto as Annex A and Annex B.
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(e) You shall have received on the Closing Date an opinion, dated the
Closing Date, of Hunton & Xxxxxxxx, counsel for the Underwriter, to the effect
that:
(i) the Shares have been duly authorized, and when issued and
delivered to the Underwriter against payment therefor as provided by
this Agreement, will have been validly issued and will be fully paid
and nonassessable, and the issuance of such Shares is not subject to
any preemptive or similar rights;
(ii) the Registration Statement has become effective under the Act
and, to the knowledge of such counsel, no stop order suspending its
effectiveness has been issued and no proceedings for that purpose
are pending before or threatened by the Commission ;
(iii) this Agreement was duly and validly authorized, executed and
delivered by each of the Transaction Entities; and
(iv) the Registration Statement, at the time it became effective,
and the Prospectus, as of the date of the Prospectus Supplement (in
each case, other than documents incorporated therein by reference
and the financial statements and supporting schedules and other
financial and statistical data included or incorporated by reference
therein, as to which no opinion need be rendered) complied as to
form in all material respects with the requirements of the Act.
In addition, Hunton & Xxxxxxxx shall state that they have
participated in conferences with officers and other representatives of the
Transaction Entities and representatives of the independent public accountants
for the Company and representatives of the Underwriter at which the contents of
the Prospectus and related matters were discussed and, although they are not
passing upon and do not assume any responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration Statement or the
Prospectus or the documents incorporated therein by reference, on the basis of
the foregoing (relying as to materiality to a large extent upon the opinions of
officers and other representatives of the Transaction Entities), no facts have
come to the attention of such counsel which lead them to believe that the
Registration Statement, including the documents incorporated therein by
reference, at the time the Company filed its Annual Report on Form 10-K for the
Year Ended December 31, 1996, or at the date of the Underwriting Agreement,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectus, including the documents
-18-
incorporated therein by reference, at the time the Prospectus was first provided
to the Underwriter for use in connection with the offering of the Shares or at
the date hereof, contained or contains an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading (it being understood that such counsel need express no
opinion with respect to the financial statements and schedules and other
financial or statistical data included in the Registration Statement, the
Prospectus or the documents incorporated therein by reference).
(f) On the date hereof, Coopers & Xxxxxxx shall have furnished to the
Underwriter a letter, dated the date of its delivery, addressed to the
Underwriter and in form and substance reasonably satisfactory to the Underwriter
(and to its counsel), confirming that they are independent public accountants
with respect to the Transaction Entities and their subsidiaries as required by
the Act and with respect to the financial and other statistical and numerical
information contained in the Registration Statement. At the Closing Date,
Coopers & Xxxxxxx shall have furnished to the Underwriter a letter, dated the
date of its delivery, which shall confirm, on the basis of a review in
accordance with the procedures (not constituting an audit) set forth in the
letter from it, that nothing has come to its attention during the period from
the date of the letter referred to in the prior sentence to a date (specified in
the letter) not more than five days prior to the Closing Date, which would
require any change in its letter dated the date hereof if it were required to be
dated and delivered at the Closing Date.
(g) At the Closing Date, the Shares shall have been approved for listing
on the NYSE subject to official notice of issuance.
(h) Each of the Transaction Entities and their subsidiaries shall not
have failed at or prior to the Closing Date, to perform or comply with any of
the agreements pursuant to Section 5 herein contained and required to be
performed or complied with by the Transaction Entities at or prior to the
Closing Date.
(i) At the Closing Date, Hunton & Xxxxxxxx shall have been furnished
with such documents and opinions as they may reasonably require for the purpose
of enabling them to pass upon the issuance and sale of the Shares, as herein
contemplated and related proceedings, or in order to evidence the accuracy of
any of the representations or warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by each of the
Transaction Entities in connection with the issuance and sale of the Shares as
herein contemplated shall be reasonably satisfactory in form and substance to
the Underwriter and Hunton & Xxxxxxxx.
9. Effective Date of Agreement and Termination. This Agreement shall become
-------------------------------------------
effective upon the execution of this Agreement.
This Agreement may be terminated at any time prior to the Closing Date
by you by written notice to the Company if any of the following has occurred:
(i) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has been a Material Adverse
Effect, (ii) any outbreak or escalation of hostilities or other national or
international calamity or crisis or change in economic conditions or in the
financial markets of
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the United States or elsewhere that, in your judgment, is material and adverse
and would, in your judgment, make it impracticable or inadvisable (x) to
commence or continue the offering of the shares to the public or (y) to enforce
contracts for the sale of the shares, (iii) the suspension or material
limitation of trading in securities on the NYSE or the American Stock Exchange
or material limitation on prices for securities on either of such exchanges,
(iv) (a) the downgrading of any of the debt securities of any of the Transaction
Entities or any of their subsidiaries by any "nationally recognized statistical
rating organization" or the announcement by any such organization of an initial
rating with respect to any such securities that is below the ratings of other
such organizations in effect for such securities on the date hereof, or (b) the
public announcement by any such organization that it has under surveillance or
review, with possible negative implications, its rating of any of such securiti
es, (v) the enactment, publication, decree or other promulgation of any federal
or state statute, regulation, rule or order of any court or other governmental
authority which in your reasonable opinion would result in a Material Adverse
Effect, (vi) the declaration of a banking moratorium by either federal or New
York State authorities or (vii) the taking of any action by any federal, state
or local government or agency in respect of its monetary or fiscal affairs which
in your opinion has a material adverse effect on the financial markets in the
United States.
10. Miscellaneous. Notices given pursuant to any provision of this Agreement
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shall be addressed as follows: (a) if to the Company, to Secretary, Colonial
Properties Trust, 0000 Xxxxx Xxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxx 00000 and (b) if
to you, to Xxxx Xxxxx Xxxx Xxxxxx, Incorporated, Attention: Syndicate
Department, 000 Xxxxx Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000, or in any case
to such other address as the person to be notified may have requested in
writing.
The provisions of Sections 5, 6 and 7 shall remain operative and in full
force and effect, and will survive delivery of and payment for the Shares,
regardless of (i) any investigation, or statement as to the results thereof,
made by or on behalf of the Underwriter or by or on behalf of any of the
Transaction Entities, the officers or directors of any of the Transaction
Entities or any controlling person of any of the Transaction Entities and (ii)
acceptance of the Shares and payment for them hereunder.
In the event of termination of this Agreement, the provisions of
Sections 5(j) and 7 shall remain operative and in full force and effect.
If this Agreement shall be terminated by the Underwriter because of any
failure or refusal on the part of any of the Transaction Entities to comply with
the terms or to fulfill any of the conditions of this Agreement, each of the
Transaction Entities, jointly and severally, agrees to reimburse the Underwriter
for all out-of-pocket expenses (including the fees and documented disbursements
of counsel) reasonably incurred by the Underwriter.
Except as otherwise provided, this Agreement has been and is made solely
for the benefit of and shall be binding upon each of the Transaction Entities
and the Underwriter, any controlling persons referred to herein and their
respective successors and assigns, all as and to the extent provided in this
Agreement, and no other person shall acquire or have any right under or by
virtue of this Agreement. The term "successors and assigns" shall not include a
purchaser of any of the Shares from the Underwriter merely because of such
purchase.
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This Agreement shall be governed and construed in accordance with the
laws of the State of New York.
This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument.
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Please confirm that the foregoing correctly sets forth the agreement
among the parties hereto.
Very truly yours
COLONIAL PROPERTIES TRUST
By: /s/ Xxxxxxx X. Xxxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxxx
Title: Senior Vice President and Secretary
COLONIAL REALTY LIMITED PARTNERSHIP
By: Colonial Properties Holding Company, Inc.,
its General Partner
By: /s/ Xxxxxxx X. Xxxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxxx
Title: Senior Vice President and Secretary
XXXX XXXXX XXXX XXXXXX, INCORPORATED
By: /s/ Xxxxxx Xxxxxxx
---------------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
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